By Taxeasy Solution – Your Trusted Tax Consultant
Introduction
In a country where agriculture is the backbone of the economy, empowering farmers through collective platforms is the need of the hour. One such powerful model is the Farmer Producer Organisation (FPO). Whether you’re a group of farmers, an agri-entrepreneur, or a social worker aiming to organize farmers, understanding how to register an FPO is critical.
This blog by Taxeasy Solution, Supaul Bazar, Darbhanga, Bihar, gives you a complete overview of what an FPO is, how it is registered, what legal options are available, documents required, benefits, and government schemes involved.
What is an FPO (Farmer Producer Organisation)?
An FPO is a group of farmers who come together to form a legal entity to collectively undertake activities related to agricultural production, harvesting, processing, packaging, marketing, export, and import. It enables farmers to increase their bargaining power, reduce input costs, and get better prices for their produce.
Legal Options to Register an FPO in India
There are four primary legal forms under which an FPO can be registered:
1. Producer Company
- Registered under Companies Act, 2013 (Section 378A to 378ZU)
- Most popular and recommended legal structure for FPOs
- Must have “Producer Company Limited” in its name
2. Co-operative Society
- Registered under respective State Co-operative Acts or the Multi-State Co-operative Societies Act, 2002
- Suitable for local operations or multi-state operations respectively
3. Society (NGO Type)
- Registered under Societies Registration Act, 1860
- Used for awareness, training, and development purposes (not recommended for commercial agri-business)
4. Private Limited Company
- Registered under Companies Act, 2013
- Can be used if agri-startups or entrepreneurs collaborate with farmers, but it’s not an FPO in the legal sense
Who Can Form an FPO?
- Minimum 10 individual farmers
- Minimum 5 Directors (from among the members)
- Only producers (farmers, dairy producers, artisans, etc.) can become members
Minimum Capital Requirement
- A minimum paid-up capital of Rs. 5 lakh is required for Producer Company registration.
Benefits of Registering an FPO
- Better market access through collective selling
- Reduced input cost via bulk purchasing
- Access to government subsidies, loans, and grants (NABARD, SFAC)
- Eligibility for schemes like 80P tax benefits
- Ownership and control in the hands of farmers
- Strengthening rural economy and livelihoods
Documents Required for FPO Registration
A. From Each Director and Member:
- PAN Card
- Aadhaar Card / Voter ID / Driving License
- Passport size photograph
- Mobile number and email ID
- Signature (scanned)
- Recent bank statement or utility bill (address proof)
- DSC (Digital Signature Certificate)
B. For Registered Office:
- Latest electricity/water bill (not older than 2 months)
- Rent agreement + NOC (if rented)
- Property ownership documents (if owned)
C. Company-Related Information:
- Two name options for the FPO
- Main objectives and area of operation
- Capital structure
- Educational and occupational details of directors
- Date of birth of all directors
Step-by-Step Process to Register a Producer Company (FPO)
- Collect required documents from all members
- Apply for Digital Signature Certificate (DSC)
- Apply for Director Identification Number (DIN)
- File Name Reservation (RUN) with MCA
- Draft MOA & AOA (Memorandum and Articles of Association)
- File SPICe+ (Part A & B) forms online
- Submit AGILE-PRO for GST, EPFO, ESIC, Bank Account
- Get Certificate of Incorporation from MCA
- Apply for PAN, TAN, GST Registration
- Open a dedicated FPO bank account
Support from Government Institutions
| Institution | Support Provided |
|---|---|
| SFAC | Equity Grant up to Rs. 15 lakh, Credit Guarantee Fund |
| NABARD | FPO promotion, Seed Capital, Infrastructure support |
| JEEViKA (Bihar) | Promoting SHGs and transforming into FPOs |
| State Agriculture Dept. | Subsidies, linkage to procurement agencies |
Frequently Asked Questions
Q. Can a co-operative society be converted into a producer company?
Only inter-state co-operative societies can be converted into a Producer Company as per the law.
Q. Is it mandatory to have an auditor?
Yes. Producer Companies must have accounts audited annually by a Chartered Accountant.
Q. How long does the registration take?
Usually between 15 to 20 working days, depending on documentation and approvals.
Q. Is there any tax benefit for FPOs?
Yes, certain Producer Companies may be eligible for income tax exemptions under Section 80P, if they meet conditions.
Contact Us
Taxeasy Solution
Tax Consultant – FPO, GST, Income Tax, Company Registration
1st Floor, Station Road, Supaul Bazar,
Afjala, Darbhanga, Bihar – 847203
📞 6289187606
🌐 www.sharpsignals.in
